U.S. Ends De Minimis Duty-Free Imports: What Procurement Must Do Now

U.S. consumers could soon have a harder time buying some of their favorite low-cost products. Here’s why. 

The Trump administration has announced August 29 as the deadline for scrapping the de minimis exemption. The exemption allowed companies to ship low-value packages to the U.S. tariff-free. 

The end of the exemption means that goods valued at $800 or less can no longer enter the U.S. duty free. Several postal companies of Europe, such as Germany’s Deutsche Post, are set to pause standard parcel shipments to the U.S. Britain’s Royal Mail and Australia Post are also taking steps to deal with the challenge. They have paused shipments to the U.S. as they work to adapt to the new tariff regime. 

How Will the End of Exemption Impact U.S. Imports and Consumers 

The numbers give a glimpse of the impact. Customs and Border Patrol (CBP) processes over 4 million de minimis shipments into the U.S. each day, as per an estimate by the Trump administration in April this year. 

In fiscal 2024, 1.36 billion shipments arrived under this exemption with an estimated value of $64.6 billion, according to U.S. Customs and Border Protection. About 73% of these shipments originated from China. 

Many businesses – foreign and domestic – had flourished by incorporating the “trade loophole” into their supply chains. Trump believed that the exemption was a “catastrophic loophole” that allowed companies to evade tariffs and get “unsafe or below-market” products into the U.S. 

Chinese e-commerce giants are feeling the heat. Popular low-value online retailers, such as Shein and Temu, are already feeling the impact, with sales and engagement rates dropping significantly following the end of the exemption. 

Tapestry, the parent company of leather bags fashion brand Coach, anticipates a $160m hit to its profits, with about a third of that related to the de minimis rule elimination. 

Consumers, already under pressure from inflation and high interest rates, should brace for higher costs and supply disruptions. They can also expect to see less variety of goods in stores and on e-commerce platforms. 

The paperwork for sellers will also increase as U.S. customs look for the origin and type of goods in packages. Platforms like eBay and Etsy have asked sellers to communicate tariff-related price increases to customers. 

Small British businesses that sell online to U.S. shoppers have already alerted customers to price hikes. Merchant & Mills, a sewing pattern and fabric company, has announced a 15% price increase to cover duties. 

Businesses will have to rethink their supply chains as well as their overall operating models. The extent of impact will increase in the coming days, as the de minimis exception ends not only for China and Hong Kong but for all countries. 

Procurement leaders cannot wait for carriers or policymakers to smooth this shift. They need a concrete playbook to manage higher landed costs, disrupted delivery lanes, and new compliance obligations. 

How Procurement Teams Can Respond and Protect Against Rising Import Costs 

1. Quantify cost changes per item. 

Reconstruct your import history for the past 6-12 months involving parcels under $800. Calculate landed-cost deltas. Use the August 29 cutoff to split data. Focus on duty, carrier fee, broker charges, and potential delays. 

2. Consolidate shipments. 

Freeze the “one parcel per order” approach. Consolidate small orders into full containers or pallets consumed by U.S. fulfillment centers or 3PL partners. This eliminates per-parcel duty and gives control over paperwork and manifest quality. Team up with your customs broker to ensure continuous bond and ACE filings are in place. 

3. Secure duty classification and origin early. 

At order creation, include accurate HS codes. If you deal with high-volume or high-duty items, invest in binding rulings. Ensure documentation of origin accompanies Pos, not just shipments, to avoid delays and rejections. 

4. Maximize existing duty-relief programs. 

Work within current FTAs to qualify for lower tariff rates. Use bonded warehouses or Foreign-Trade Zones to defer or reduce duty costs. If you’re re-exporting returned goods, use duty drawback programs. Some allow recovery of nearly all duties paid. 

5. Rethink sourcing routes. 

Push for supply options from within USMCA or other FTA regions. Validate each supplier’s ability to meet the rule of origin and maintain two parallel sources per key SKU, so you can pivot quickly if one becomes cost-ineffective. 

6. Redefine contract terms with suppliers and carriers. 

Redraft incoterms to clearly identify who handles duty, taxes, brokerage. Create a short duty-surcharge table by SKU or HS code that your finance team can activate when needed. Use the August 29 trigger as a clause in future contracts. 

7. Build a carrier reliability dashboard. 

Map shipping lanes by provider and flag “green” (clear obligations and duty handling), “amber” (unresolved documentation), and “red” (service paused or unresponsive). Update daily until stability returns. 

8. Prepare customer communications and order logic. 

Adjust minimum order values to keep duty per order reasonable. Train customer service to explain delays or new customs charges upfront. Define clear returns policies that reflect the added costs and procedures. 

9. Run weekly compliance checks. 

Audit a small batch of upcoming shipments each week—validate origin, classification, value, party IDs. Catch errors early. A weekly 50-item check is more effective than a big sweep post-delivery. 

Why This Matters 

The era of ultra-low-cost, duty-free shopping is over. The pause on the de minimis exemption is permanent, not a trial. It changes how your company must import, price, route and document goods entering the U.S. 

The companies that win will see this as a permanent reset. They’ll restructure logistics, upgrade documentation, strengthen internal controls and use existing duty tools to buffer disruption. 

The policy is clear. CBP and carriers will enforce it. What remains is how fast procurement teams can adapt. 

Also Read: GEP Tariff Management Resource Center